SEC considers formal action against Fidelity in gifts probe

07/26/05 - newratings.com

NEW YORK, July 26 (newratings.com) - The US Securities and Exchange Commission (SEC) is considering civil action against Fidelity Investments, associated with an investigation into the receipt of gifts and gratuities from brokers.

The world's largest mutual-fund company said in a statement on Monday that the SEC had sent it a "Wells Notice," a warning that the Commission is considering recommending formal action against the Boston-based firm for violating rules on accepting gifts from brokers. The gifts and gratuities probe started last year, with the SEC investigating brokers courting Fidelity Investments’ trading business to determine whether business was being given to brokers in exchange for private jet trips, expensive wines and sports tickets. Fidelity Investments said in a statement "We intend, however, to vigorously defend ourselves against any allegations that we believe are not supported by relevant facts and data while working cooperatively to achieve a satisfactory resolution to this matter as promptly as we can."